COFOE MEDICAL (HKEX: 01187) shares experienced a significant afternoon rally, climbing over 6%. At the time of writing, the stock was up 4.3%, trading at HK$35.88 with a turnover of approximately HK$10.99 million.

The surge follows an announcement from the company on July 20th. Cofoe Medical stated that its controlling shareholder plans to repurchase between RMB 100 million and RMB 200 million worth of its A-shares. The buyback initiative is based on confidence in the company's future development and recognition of its intrinsic value, aiming to safeguard the interests of all shareholders and bolster investor confidence.

The decision considers the company's operational performance, financial status, future profitability, and reasonable valuation levels. The repurchase will be conducted through centralized competitive bidding on the secondary market. All repurchased A-shares are intended to be canceled, leading to a reduction in the company's registered capital.

The maximum repurchase price is set at RMB 69.66 per share. The funding for the buyback will come from the company's own capital and proceeds from a dedicated stock repurchase loan. China CITIC Bank Corporation Limited, Changsha Branch, has committed to providing a special loan of up to RMB 180 million to support this repurchase, with specific terms to be finalized in a formal loan agreement.